LECTURE 2: MANAGING FOR EFFICIENCY

AND CONTROL SCIENTIFIC MANAGEMENT

1. Why study management history is important?
• Studying management history is important because it helps us understand today’s
management practices by seeing their origins
• History also helps us see what did and did not work

2. HISTORICAL BACKGROUND OF MANAGEMENT

EARLY MANAGEMENT
• Organized endeavors have existed for thousands of years
• The Egyptian pyramids and the Great Wall of China are proof that projects of tremendous
scope, employing tens thousands of people were completed in ancient times
In 1776, Adam Smith published “ The Wealth of Nations”
• division of labour (job specialization): the breakdown of jobs into narrow and
repetitive tasks

Industrial revolution : a period during the late eighteenth century when machine
power was substituted for human power, making it more economical to manufacture
goods in factories than at home.
SCIENTIFIC MANAGEMENT

Context
• After the Civil War (1861–1865) industry begin to change.
• National industries emerged from local trades, giving rise to expansive steel, glass, textile,
and footwear sectors, with once modest factories evolving into substantial manufacturing
plants.
• Owners of capital became wealthier with mass production, and workers received little for
their efforts.
• Problems:
o carelessness,
o safety,
o inefficiencies,
o soldiering (worker foot dragging) on the job.

• For the first time, the owners of these factories had to consider how to organize and control a
large amount of labor to achieve organizational goals;
• Faced the challenge of searching for new techniques to manage their organizations’ resources,
productivity increase and workers skill improvement
• The two most important contributors to scientific management theory were Frederick W. Taylor
and the husband-wife team of Frank and Lillian Gilbreth.

• Frederick W. Taylor (1856 – 1915): The father of scientific management

o American mechanical engineering
o From 1890 until 1893 Taylor worked as a general manager and a consulting engineer
to management for the Manufacturing Investment Company of Philadelphia, a
company that operated large paper mills in Maine and Wisconsin.
o During that time, he conducted the time studies
o His first paper, A Piece Rate System, was presented to the American Society of
Mechanical Engineers (ASME) in June 1895
o In 1909, Taylor published The Principles of Scientific Management
o Taylor was president of the ASME from 1906 to 1907
o On October 19, 1906, Taylor was awarded an honorary degree of Doctor of
Science by the University of Pennsylvania
o In 1877, Frederick W. Taylor started as a clerk in Midvale, but advanced to foreman
in 1880. As foreman, Taylor was "constantly impressed by the failure of his [team
members] to produce more than about one-third of [what he deemed] a good day's
work".[4] Taylor determined to discover, by scientific methods, how long it should
take men to perform each given piece of work; and it was in the fall of 1882 that he
started to put the first features of scientific management into operation
• Frank and Lillian Gilbreth:
o Conducted the motion studies
TIME AND MOTION STUDIES
Systematic observation, analysis and measurement of the separate steps in the performance of a
specific job for the purpose of establishing a standard time for each performance, improving
procedures and increasing productivity .
• correct time
• the one best way to perform a task
• ensure that the assessed task minimizes any redundant movements on the part of the workers
PRINCIPLES OF SCIENTIFIC MANAGEMENT
The principles and stages
The central elements of Taylor’s system involved four basic steps :
1. Analysis of each element in the labor process including rules of motion for each worker and
standardization of working conditions (Time and motion information)
2. Scientific selection, training and development of workers
3. Cooperation of managers and workers
4. Equal division of work and responsibility between management and workers
SCIENTIFIC MANAGEMENT PRINCIPLES
• Science, not rule of thumb;
Scientific investigation should be used for taking managerial decisions instead of basing decisions on
opinion, intuition or rule of thumb.
• Harmony (agreement), not discord(conflict);
Harmonious relationship between employees and employers.
• Cooperation, not individualism;
Cooperation of employees that managers can ensure that work is carried in accordance with
standards.
• Maximum output, not restricted output
Maximum output will result in higher wages for the workers and greater profit for the management.
• Development of each man to his greatest efficiency and prosperity (Taylor,
1915:140)
All possible human efforts should be utilized maximally leading to efficiency and prosperity for the
workers and the business.
SCIENTIFIC MANAGEMENT REVOLUTIONIZED INDUSTRY
it explained how to increase production by working smarter, not harder
Up until that time, increasing output meant:
• more hours,
• more employees,
• more raw materials, and more costs.
Scientific management uses basic logic to show how:
• standardization,
• productivity, and
• division of labor
• increase efficiency.
THE BENEFITS OF A “ONE BEST WAY”
• improve the amount and quality of each worker’s output.
• provide a reliable measure through which managers could assess the quality and quantity of
output.
 • allowed managers to establish greater power over the workers.
• enabling the company to pay much higher wages to their workmen, and giving the company
much larger profit (Taylor 1942).
• scientific analysis of the labor process had reduced all jobs to simple and repetitive tasks,
prompting further study by other theorists including Frank and Lillian Gilbreth.
THE HEYDAY OF SCIENTIFIC MANAGEMENT
• Through these principles, Taylor famously managed to increase productivity by 380 per cent
during one of his appointments as a management consultant
• Industry embraced scientific management principles, with considerable economic impact.
Between the year 1700 and 1900 the UK Gross Domestic Product per capita went from
£1.7k to £4.9k, representing an increase of 288 per cent, and then from 1900 to 2015 it
went from £4.9k to £29k, representing an increase of nearly 600 per cent
• Taylor’s work at Bethlehem Steel resulted in the cost of loading pig iron on to railcars being
reduced from 8 cents per ton to 4.8 cents (Nelson, 1977). He was said to have patented at
least seven different inventions between 1880-1915 in pursuit of further efficiencies (Nelson,
1974). And now that pay was linked to performance, workers were seeing opportunities to
increase their earnings by up to 60 per cent
JAPAN AND TAYLORISM
• Japanese industry also adopted Taylor’s techniques.
• One of the first disciples of scientific management in Japan was a man named Ueno Yoichi.
• In 1919, Ueno was hired by the Lion Tooth powder Company, where he increased the
productivity of its packaging department by 20 percent while reducing the area of working space by
30 percent and cutting work time by one hour per day.
• Uneo became a leading proponent of scientific management in Japan.
• In the years leading up to the Second World War, many in Japanese industry embraced Taylorism.
SCIENTIFIC MANAGEMENT TODAY
• Still embedded in mass production (manufacturing);
• Pervasive in mass consumption industries (fast food, mass entertainment):
o McDonalds; and
o Disney.
• Increasing in service organizations:
o Call centers.
• Division of labor forms the basis of the way in which work is organized;
• Still a focus on individual productivity of workers, via implementation of a ‘science of a job’;
• Human resource managers still concerned with workplace harmony and fostering
cooperation.
PROBLEMS WITH SCIENTIFIC MANAGEMENT
• There is little or no room for either horizontal or vertical labour mobility.
• Decline in skill
• Decreased job security
• Ignores intrinsic rewards
• Workers can become bored and uninterested in their job
• Limited to labour intensive